GI Dynamics (ASX:GID) said it launched a pivotal trial of its EndoBarrier plastic gut sleeve, aiming to win back CE Mark approval next year, and raised the second tranche of a $10 million financing plan.
The Boston-based company won approval for the trial in February to observe the EndoBarrier sleeve designed to prevent the absorption of nutrients from food as it exits the stomach and enters the intestinal tract to treat Type 2 diabetes and obesity.
In a missive to stakeholders, president & CEO Scott Schorer said the study will also look at data such as cardiovascular risk markers and insulin sensitivity, as well as liver fat and liver stiffness. CKD markers will be observed in a pivotal trial for the first time in the U.S., according to Schorer. GI Dynamics is also working with Apollo Sugar to initiate a similar trial in India, which is scheduled to begin enrolling in the fourth quarter of 2019.
In the meantime, Schorer said the focus is on obtaining CE Mark approval, which the company hopes to receive during the first half of 2020, Schorer said.
GI Dynamics also announced that it received the second, $2 million tranche from a series of warrant exercises that began with an initial $2 million in August. Crystal Amber (GBX:CRS) has pledged a total of $5.4 million in exchange for the warrants; another $1 million exercise is slated for Oct. 31 and a final, $400,000 exercise is on tap for Nov. 15. The Crystal Amber deal also includes a convertible note worth another $4.6 million GID doesn’t plan to cash in until Dec. 6.
The company said it plans to use the most recent funds for general working capital, to assist with enrollment for the U.S. and India trials and continue working toward the CE Mark for the EndoBarrier.
Shares of GID were up 2.2% to 4.6¢ per share in early-morning trading today.